Welcome to my August blog! Over the last few weeks, I've had a number of people get in touch for advice on budgeting whilst waiting for their first Universal Credit payment. Typically, you will receive your first UC payment five weeks after you complete your claim, but it can be longer if there are any complications.

I know that the wait for your first payment can cause a lot of anxiety and so, in this blog, I've put together my top tips for budgeting, both before making a claim and while you wait for your first payment.

Preparing for the wait: Budgeting

Before you complete your online claim for Universal Credit, take the time to assess your current financial situation. You should consider creating a budget, to get a full understanding of how much money you spend each month and what you are spending it on. By identifying where you can cut costs before you claim, you can feel more prepared to survive on a limited income while waiting for your first payment.

If you’re unfamiliar with budgeting, try using an online budgeting tool, such as this one created by the Money Advice Service.

For most people, rent is the largest of our monthly outgoings. The wait between claiming UC and receiving the first payment can prevent many from paying their rent on time, resulting in arrears. To prevent this from happening, consider making additional payments to your rent in the weeks or months ahead of making your claim; an extra £10 a week towards your rent could put your account ahead by £40 a month, which will help to keep your rent account in positive figures while you wait for your first UC payment.

If you have already fallen into arrears because you are awaiting your first UC payment, please do not panic; the best thing you can do is talk to us, to let us know what’s going on.

I’m waiting for my payment and am struggling – what should I do? 

Myself and the Advice Team at Southway are always here to help. Although it may feel overwhelming, by contacting us, we can gain a better of understanding of your financial situation and be able to offer you the support you need. We want to work with you and support you as much as we can as you await your first payment. 

Can I get an advance on my claim?

The Department of Work and Pensions (DWP) does offer an advance payment on your UC claim, to help cover emergency costs. This is called a Budgeting Advance and it is a loan, which is repaid to the DWP through deductions to your regular UC payments. You will be informed how much your payments will be reduced by to cover this loan and it will have to be paid back in full within 12 months.

The smallest amount you can borrow is £100. The most you can get is:

  • £348 if you’re single
  • £464 if you’re part of a couple
  • £812 if you have children

How much you can get depends on whether you:

  • can pay the loan back
  • have any savings over £1,000. Your first £1,000 of savings will be ignored, but the loan amount you are offered will be reduced by £1 for every £1 you have over that first £1,000.

To qualify for a Budgeting Advance, you must meet the following criteria:

  • you must receive Universal Credit, Employment and Support Allowance, Income Support, Jobseeker’s Allowance or State Pension Credit for 6 months or more, unless you need the money to help you start a new job or keep an existing job
  • you must have earned less than £2,600 (£3,600 jointly for couples) in the past 6 months
  • you must have paid off any previous Budgeting Advances

Applying for the DWP's Advance is a good option if you are struggling with emergency or urgent costs, but you should be mindful that the repayments will be taken from your future payments, and budget accordingly.

Get in touch

I hope that you have found this blog post helpful, and that it has offered some reassurance for anyone anxious about the wait for their first payment. I understand that everyone's financial situation is different, so if you would like some more information or one-to-one advice, please do not hesitate to contact me.

You can get in touch by clicking here, sending a message through Southway's Facebook page or calling 0161 448 4200.

I look forward to hearing from you.